MobilePro backs out of Sacramento wireless network deal

Well, no one thought everything would go smoothly in the citywide wireless world. Apparently, the idea of free networks is not very kosher to MobilePro Corp., who has set up networks in cities such as Tempe, Arizona. Anyway, MobilePro and Sacramento, California had an agreement for the company to build a network in the city, but now MobilePro is backing out of the deal because the city wants the network to be free to all users.

Apparently, MobilePro feels that in a setup such as this, with the network being solely supported by advertising revenue and the city NOT acting as an "anchor tenant," the business model would not be "financially sustainable" and that the cost to support the network would be prohibitive. MobilePro did offer a solution that would offer qualified low-income users to get free access to the network, but the city wants a totally free platform.

This is certainly an interesting development. There are many sides to this issue, such as does MobilePro believe that a totally free access wireless network is not worth the investment? Does the city of Sacramento believe that enough of their residents will use the network and that there will be enough advertising money to support it?

A number of analysts are warning against the idea of a free citywide wireless network because there won't be any money coming in from user fees to support and enhance these networks over time. It would make sense to believe that advertisers would be wary of marketing their goods and services over a free network because people don't have to commit to using it, whereby a paying subscriber would be more committed to accessing the network on a regular basis and would be a more "reliable" person to market to.

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